Equities continue Reeling…seek Counselling as appropriate…Contrarion Opportunity may again be beckoning soon

I repeat what I blogged last evening

…and Oh! the markets are correcting on cue towards a Sensex of 18000…don’t attempt to call the bottom…it may be in your Minds but it’s not in your Hands !….something’s brewing and it’s worrying…getting that strong negative vibe for Feb and March….sub 18000 levels could be on the cards…In November 2010 I had opined a Sensex range of 18000 to 22000 in the first half of 2011….However I fear 18000 will be breached in the short term…Traders and Speculators beware….Investors review your Portfolio selections to assess downside risk…don’t be in any hurry to invest fresh funds or reinvest sales proceeds   

Cash is King….Those who are addicted to Trading and Speculating are strongly advised to switch from Brokers and Stock Channel Counselling to Psychological Counselling first and then to some serious and rational and professional Investment Counselling ! 

Investors are well advised to seek Good Professional Investment Counselling….stop being penny wise and pound foolish !….atleast ,as stated last evening and repeated above,review your Selections to assess the downside…and tune your mindsets to a longer perspective,preferably three years…The Discipline of Asset Allocation first and then Equity Portfolio Construction to match your Risk Profile will now be more easily accepted to adhere to ….You will need to ‘Bear’ this Fall and be wisened that when the ‘Bull’  snorts,everybody ‘Bulls’ around and believe it’s their skills and not just luck or the trend that is making them the Monies….succumbing to irrational exuberance is oh! so easy…but when the tide turns you’ll see, as Warren Buffett asserts, that most are swimming ‘naked’

It’s a pointless exercise inquiring of your Broker on past but fairly recent  2010 recommendations that have gone terribly sour and south…he’s not lost the monies…you have if you had acted on them as you were guided,coaxed and urged to….for example IVRCL Infrastructure…End September 2010 a host of Broking Houses released strong ‘Buy’ reports at Rs 170 with targets of Rs 201 and Rs 238 and beyond …this was probably after being wooed by the Company in Analyst Meets….It became their Darling Stock….Inside four months IVRCL Infra is quoting at 52 Week Lows today of Rs 83 !…that’s an erosion of over 50% !….I wonder how many of these Broking Houses will now issue a follow up Report on IVRCL Infra….and how many of their Clients will trust them and act on any such report !        

However having sounded the caution ,I must confess that this Fall in Equities will give you some nice Opportunities to buy into for doubling your monies inside two to three years…some inside a year itself !…you need to go long  selectively on this Conviction in the days and weeks ahead…maybe even in IVRCL Infra !….but as I said you need strong conviction to go Long yet again at significantly lower prices…that comes from an Understanding of Valuation and blending Intellect with Instinct

It’s tough to take Contrarion Calls and go against the Herd….Only a Few do so…but India has thrown up huge opportunities (1992,1997,2001,2003,Oct 2008,March 2009) in the past to take such calls for significant upside…..I sense this Fall too is leading to another Opportunity…but do you have the Conviction !…..and the Sense to make the right Selection?

Cheers ! 

9 thoughts on “Equities continue Reeling…seek Counselling as appropriate…Contrarion Opportunity may again be beckoning soon

  1. That was direct and straight Tejas,just like so many ask !….Fish or learn to Fish ?…I think it’s in the Bible ” Go Forth and Seek and Thou shall Find “….Look for Cash Rich Companies that are quoted below their Book Value for starters…Cheers !

  2. Hi Gaurav.. Thanks a lot for warning us .. I was almost certain that we had hit the bottom on NIFTY/SENSEX for 2011 and that Feb wud be a month of revival (just intution .. no fundamental reason …. 😛 ).. I was doing my research on a few stocks I have mentioned below .. I wud love to hear from u on these …
    1. Koutons Retail .. (I always see 70% off or “Buy 1 get 3 free” offers in their outlets .. So .. very much tempting)
    2. JM Financial (Tracking it since news broke that Mukesh Ambani was in talks to aquire it)
    3, JSW Eneergy (~84 … Near Issue price .. I am being advised by many to consider this option as a safe investment)
    4. IVRCL Infra (we have already discussed about this)
    5. Pantaloon Retail ( I am waiting for it to come down to Rs250 .. Thank u again for warning me on this when it was around Rs320)
    6. Provogue (Recommended by you in your blog at around Rs 65 levels … now ~46 .. do u still recommend? .. Plz dont mistake me .. I am asking this again just to give myself more confidence)
    7. Lakshmi Energy & Foods Ltd (Stock was ~Rs154 in Feb 2010.. now Rs 54 .. Buy back on the cards since Nov 2010) ..

  3. 2011 looks like a tough year..specially as sensex has broken 18500. So i suspect a structurally bear phase has opened..so on every upside selling may come.it may remain sell on rallies kind of market for 6-8 months.

  4. Sir,first of all I would like to apologize for being such direct and straight and I completely agree with your point and I’m working on finding such cash rich companies whose book value is more than current market price…….

  5. Hey Tejas !..No Sweat !..I would be worried if people stopped asking me for which Company looks good for Investing !…my blogs will give you a lot of hints…cannot afford to be direct all the time…owe this much to Clients…..but you will surely get a sense of what not to do !….and ofcourse you can ask my opinion on any Company that interest you…a lot of people do….if it really looks interesting and also serves a larger audience I tend to review it and put it up on the blog seperately or as a reply….Cheers !

  6. gaurav sir,
    if possible when time permits you just give your view on ennore coke.Its a pure commodity company but still your reviews are useful

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